It’s no secret that casinos have been running uphill for the past few years. Using Las Vegas as a barometer, the Bank of America Gaming Market Overview 2012 stated that gaming revenues declined by 10.5 percent in 2008 and 9.6 percent in 2009, but cautiously predicted an upswing. Nationwide, the numbers were steady but lagging, with Native American casinos holding their own despite the downturn. Now, after 22 months of sliding, there seems to be some optimism on the horizon, and at last a collective sigh of relief may be around the corner. In an effort to feed the uptrend momentum, casinos are seeing results through reinvention and becoming more aggressive in the mix of amenities they offer to diversify their guest base. In many markets, what was once an adult playground has given way to a guest profile in need of a literal playground.
Attracting families with children has often been explored as a way back to profitability, but along with these customers come a set of unique challenges that properties must address. Bottom line: Parents must have a safe and secure environment in which to place their children while they enjoy the casino. Without it, problems ensue.
In order to understand how the industry got to this point, one must first understand how children became a legitimate part of the casino environment. In the early ‘90s, an effort to create a larger guest base brought the concept of a gaming property as a family-friendly “resort.” Casinos were not just for gambling any longer, instead providing a wide range of amenities and activities beyond slots and table games. Las Vegas first employed this strategy, and other casinos followed suit in an effort to improve their numbers during a downturn in the economy. At the same time, Las Vegas and Atlantic City, once bastions of the gaming industry, began to experience competition in the form of Native American and neighborhood casinos. Gaming was not a plane ride away anymore—it was a stop on the way home or a date-night excursion. In order to serve families and make an impromptu stop possible, properties on the cutting edge sought out well-qualified and experienced child care providers. Kids Quest, founded in 1992, caters to the very niche casino market. With 20 locations in 12 states, Kids Quest continues to offer parents a safe and affordable care option for children within the casino environment.
When trends shifted once again, Las Vegas reclaimed the “Adult Disneyland” moniker with its What Happens in Vegas, Stays in Vegas® marketing campaign. Executives brought sexy back to casinos, with some gaming properties moving away from the family-friendly atmosphere entirely. But by this time, many adults had become accustomed to having their children in tow when frequenting a gaming resort. If there was not a viable place at the casino to get care for their youngsters, parents were either staying away entirely or leaving their children unattended while they gambled—neither of which bode well for gaming properties. And so today here we are again, full circle, with some casinos looking to attract family-based guests in order to regain a foothold in a slippery-slope economy.
The revenue from the family-based guest can translate into significant dollars for casino properties. For example, Kids Quest guest studies reveal a profile for its clientèle that boasts a gaming rate 96 percent higher than the average patron. Likewise, University of Nevada, Las Vegas studies have shown that casino guests on overnight trips are more likely to be college-educated adults from a dual-income household that has a higher disposable income—a demographic that is very likely to have at least one child, if not more. Furthermore, in the current economic climate, many families are combining what used to be “adults only” vacations with family trips and are in need of entertainment options for their children.
A child care amenity also goes a great distance toward building significant customer loyalty and repeat visits. Families familiar with Kids Quest are willing to travel longer distances and bypass competitors when the casino offers this kind of child care option. In fact, 88 percent of Kids Quest parents surveyed reported that they would not have visited the respective casino-resort if it was not offered as an option for their children. With an amenity like this on property, guests stay on the gaming floor longer, actively frequent live entertainment venues, see more movies, indulge in spa services, enjoy high-end restaurant experiences, and take advantage of retail opportunities. In short, casinos are full of activity from these guests. The average casino ROI for bringing a Kids Quest to the property falls into the 200 to 300 percent range in the first year of operation. This is primarily due to the incremental gain in gaming revenue coupled with the income generated elsewhere throughout the property. Kids Quest is a unique amenity because it does not take the guest off the casino floor or out of other venues while it generates ancillary income for the casino—instead, it creates a simultaneous stream of revenue.
A Cyber Quest lobby.Casino patrons who have used Kids Quest have come to depend on the center to help enhance their guest experience. Children ages 6 weeks through 12 years pass through custom-designed security gates and enter into a bright and colorful kid-friendly environment at a rate of more than a quarter-million per year. These full-service centers are filled with all of the latest video game technology and also feature classic children’s favorites like art, music and dramatic play. A host of physical challenges like a playpiece for climbing and a half-court gym also keep kids active throughout their stay at the facility. Infants have their own private room within the space, with Kids Quest providing a staff-to-child ratio of 1-to-4 for infants and toddlers, a standard that meets or exceeds most licensing requirements. On the open floor, children aged 30 months to 12 years share in the fun, with a staff ratio of 1-to-10, again fulfilling most licensing guidelines mandated by states to ensure proper levels of supervision. Kids Quest also employs its own version of the “eye in the sky,” with multiple security cameras recording every movement within the center. Parents can confidently check their children there, and then freely explore the casino and enjoy all it has to offer.
In 1994, in addition to child care, Kids Quest also introduced Cyber Quest, a supervised family arcade with non-violent game content. Cyber Quest made its debut in one of the world’s largest casinos, Mohegan Sun, and continues to operate there today. Working in tandem, these ventures offer a full-spectrum of entertainment options for families. Children in need of fully supervised care enjoy Kids Quest, while those ages 12 and over can explore an exciting arcade full of games at Cyber Quest. This synergy keeps children and preteens fully engaged, off the casino floor, and away from unsuitable adult amenities. Former Red Hawk Casino marketing executive Heidi Hammers summed up these two concepts recently by saying, “Kids Quest and Cyber Quest are extraordinary yet affordable casino amenities that helped differentiate our product in a very competitive landscape. Both the child care center and the arcade gave us an added advantage to eclipse the competition.”
While the feedback from Kids Quest partners has been positive, there are still properties unsure of the viability of its services. To this end, incidents of neglect—which most often include kids left alone in vehicles or hotel rooms or sent to a food court to await the return of a parent—still take place all too often nationwide. The media is quick to report these stories in hopes of deterring others from making bad decisions, but these incidents still continue to take place. In response to a recent rash of child abandonment cases in Pennsylvania, state lawmakers took action in October 2011 to introduce legislation to penalize not only the offending adult parties in these cases, but also to fine the casino property if an incident goes unreported. If this becomes law, casino management will no doubt have to respond by creating a new category of surveillance, increasing security patrols, pay for longer and more detailed training for employees, and fine-tune shift management. All of these precautions translate into additional labor costs for casinos and affect bottom line profitability.
The addition of a program like Kids Quest and Cyber Quest as a service to patrons is a responsible and proactive move toward alleviating the issue of unattended children on the premises of a casino resort while maintaining a positive industry profile. And while the addition of a child care center cannot guarantee that parents will make the right decisions, it certainly diminishes the chances. Without the child care component in place, the potential for public relations nightmares cannot be ignored. The adverse publicity alone does significant damage to a property’s reputation, particularly in areas where the casino has faced opposition from local residents and government officials. Even one abandonment incident, or any perception of negligence by an irresponsible guest, will fuel a chorus of criticism from local factions that remain skeptical regarding the viability of a casino being a part of their business community.
A Cyber Quest teammate with child.The existence of child care in a casino environment has been viewed in a variety of ways. Since its inception the early ‘90s, Kids Quest has been seen both as an innovation and an aberration. We can all agree that minors do not belong in casinos, but the reality is that they will continue to be included in casino resort outings and vacations, even if the property has not taken steps to provide a safe environment for them. The addition of child care can create a number of positives for casino management, among them a reduction in abandonment incidents, lower security costs, fewer challenges in public relations and a good citizen profile within the respective community, incremental gain in gaming revenue, increased business among other property amenities, longer guest stays, long-term customer loyalty, and a higher market share.
The benefits of including child care at a casino property far outweigh the initial cost of implementation—and the detrimental fallout from a publicized incident of child abandonment or neglect. Adding a child care component can accomplish many positive things for a casino property, not the least of which are providing families a safe and secure place for entertaining their children and creating customer loyalty to stand the test of time. Kids Quest is currently serving a second generation of clientèle—parents who once visited the centers themselves as children, a testament to the positive impact of the concept. And this is the ultimate goal of any casino property—to serve generations of guests and to maintain their loyalty.